The management of Dangote Petroleum Refinery and Petrochemicals (DPRP) has questioned the continued issuance of licences for petroleum product imports, arguing that large volumes of imported Premium Motor Spirit (PMS) are creating distortions in a market where domestic refining capacity is increasingly available.
The refinery said imported PMS accounted for about 43 per cent of petrol supplied to the Nigerian market in July, describing the figure as difficult to reconcile with its claimed capacity to meet and exceed domestic demand.
While Dangote Refinery said it remained committed to ensuring uninterrupted fuel supply, it warned that uncertainty over the volume of imported products entering the market was complicating its production, inventory and commercial planning.
The refinery said it had maintained substantial product reserves since commencing operations, requiring significant investments in storage, logistics and working capital.
However, it argued that holding large inventories becomes commercially unsustainable when competing imports enter the market without sufficient visibility over their volumes or timing.
The situation, according to the company, has increasingly forced it to export surplus products to regional and international markets to reduce storage and financing costs.
Dangote Refinery stressed that rising exports should not be interpreted as evidence of inadequate domestic supply. Rather, it said the exports reflected the consequences of a market in which locally refined petrol competes with imported products despite the availability of significant domestic refining capacity.
The company’s position, however, highlights a broader policy dilemma facing Nigeria’s downstream petroleum sector: how to balance open market competition and consumer supply security with the government’s objective of encouraging domestic refining and reducing dependence on imports.
While continued imports can provide an additional source of supply and potentially strengthen competition, excessive or poorly coordinated imports could undermine the utilisation of domestic refineries, increase pressure on foreign exchange and weaken incentives for further investment in local refining.
Conversely, restricting imports without reliable evidence that domestic producers can consistently meet demand could expose consumers to supply disruptions and reduce competitive pressure in the market.
The central issue, therefore, is not simply whether petrol should be imported, but whether import volumes are being coordinated transparently with actual domestic production and consumption requirements.
Dangote Refinery called for greater transparency in import licensing, improved coordination among market participants and policies that support domestic refining while safeguarding energy security.
It also warned that any supply shortfalls arising from poor demand forecasting or market distortions should not automatically be blamed on domestic refiners, arguing that it has demonstrated the capacity and willingness to supply the Nigerian market.
The controversy ultimately underscores the need for clearer data on national petrol demand, domestic refinery output, import volumes and inventories. Without such transparency, both refiners and regulators risk making decisions that could increase costs, distort competition and undermine Nigeria’s broader goal of building a more self-sufficient petroleum industry.
